Houston moves closer to warehouse purchase

HOUSTON – The City of Houston moved one step closer to purchasing a local warehouse with the hope to keep jobs in town and to market the building to other industry.

The Houston Board of Aldermen have met several times since early December to hammer out a deal to purchase the Jackson Manufacturing building for approximately $290,000 from Ron Jackson.

Houston Mayor Stacey Parker informed aldermen last week that a quote for insurance on the building has been obtained, a check of the sprinkler system has been done and basic environmental studies have been done.

“I am looking for a motion to move forward with purchase of the building,” said Parker. “I feel due diligence has been done, we are ready to insure it and we are ready to close.”

The motion to purchase the building was made by Dist. 3 Alderman Frank Thomas and seconded by Dist. 1 Alderman Tony Uhiren. The vote was unanimous with Dist. 2 Alderman Shenia Jones obstaining due to a conflict of interest.

By purchasing the former furniture factory at 527 First Avenue the city would be eligible to obtain state and federal economic development funds to renovate or expand the facility.

“We can’t save every old factory and warehouse and we can’t get economic development funds unless we own the building,” said Parker. “We think this is one site we can work with.”

In December, Parker said the city had been approached by Jackson seeking to sell the building so he could get tax credits before the end of they year. Houston approached Josh West, Regional Economic Developer, with the Chicasaw, Union, Pontotoc Economic Development Alliance about forging the deal.

The newer portion of the 200,000-square-foot building is being leased by International Paper as a warehouse with approximately 8 to 10 jobs linked to the building. Jackson told the city they were considering tearing the building down to avoid paying taxes in 2013 and International Paper told the city they might be forced to move jobs at the facility out of town.

Key points the city was looking to nail down was an environmental study to see if the property is contaminated, an 3-year lease with International Paper and low-interest financing from Three River Planning and Development to pay for the deal.

Under the city’s plan the rent paid by International Paper would finance all but about $4,000 of the annual note payments.

Parker said changes in insurance premiums and the hope of getting another company to lease warehouse space could make the property a money-maker for the city.

“I’ve felt all along this is a wise choice and one we should pursue,” said Parker. “I think we need to do something to position ourselves for future economic development. I’m willing to stick my neck out for this one.”

Alderman Jones said she works at International Paper but she had concerns with the $30,000 the city currently gets in taxes from the warehouse coming off the tax roll if IP left and Jackson demolished the building.

Alderman-At-Large Barry Springer said he had mixed feelings about the deal.

“International Paper has been around here a long time and if they stay around here a long time, this will be good for the city,” said Springer. “I think we need to negotiate until everybody feels comfortable with this agreement.”

The deal will also need the approval of the the Chickasaw Development Foundation Board of Directors.